Old, but I think it would be appropriate to post in this forum still...
Investment strategy pays dividends
Imagine having a payout from your investments that more than covers your monthly expenses.
Canny investor Ng Wai Chung is in this happy position at the age of 34.
Mr Ng, a senior IT manager - and an author of investment books -
achieved this a year ago. But rather than retire, he stays in full-time
employment.
His investment income stream is the result of a plan he set in
motion three years ago. That was when he decided to sell his
investments in unit trusts and buy stocks that pay high dividends.
'Today, I am able to yield about $24,000 a year on my investment
portfolio, enough to cover my expenses in most months," he said.
This enviable portfolio consists of real estate investment trusts
(Reits) and shares that yield high dividends, such as mainboard-listed
Singapore Press Holdings (SPH). Dividends are the portions of profits
which a company distributes to shareholders.
Mr Ng has an engineering degree and a master's in Applied Finance
from the National University of Singapore (NUS). He obtained the latter
part-time while working.
The senior associate in IT governance at commodity and futures
exchange Singapore Mercantile Exchange has published three books on
finance: Growing Your Tree Of Prosperity (2005), followed by Harvesting
The Fruits Of Prosperity (2007), and this year, Sowing The Seeds Of
Prosperity. They are available in bookshops.
Mr Ng is married to quantity surveyor Pang Yoke Loo, 31. They have no children.
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As for me, my portfolio consists of Reits, SPH, Starhub, ST Engg, MIIF, Trusts for dividends...
thats my aim too. sadly i dont have the money to invest in such counters. he must be pretty rich to be able to get enough lots for such high dividend payouts.
Dunno real or not...he say he invest 100k++ and get dividend of 24k++ per annum a bit hard to believe when dividend nowadays only amount up to 6%+- or so.......><"
Originally posted by maxsee:Dunno real or not...he say he invest 100k++ and get dividend of 24k++ per annum a bit hard to believe when dividend nowadays only amount up to 6%+- or so.......><"
It's possible when you do it in March 09...
Like me, my average price for Capitaland is <$2... Bought in Feb 09... My dad bought Kep Corp at $3.77 in end 08 as well...
Key is to identify value stocks and buy during recessions.... Great Singapore Sale in equities, why run away from it?
If you view stocks merely for capital gain, merely as a tool for speculation, then you can earn fast and lose fast.
Investing for dividends and long term growth is akin to investing in a property. There's nothing wrong buying blue chips during recession. How many of your friends were telling you to sell at the start of 2008? Were you buying back then? Did you have to courage to put money in when there's huge margin of safety although prices are going down? It's easy to say on hindsight, I agree. But the person in the article did that as well, bravely buying when STI was below 2000 when everyone was running away.
Prudent homework have to be done. It's not easy money, because you have to know why and what you are buying. I have missed opportunities because I have not yet finished doing homework on it, but so?
High risks? It's not when you have done sufficient homework.
In short, if you are buying on speculation and hearsay, you are subjected to high risks. If you buy according to sound principles, risks are extremely low. i.e. I bought SPH at $4, $3.8, $3.14, before it went down to near $2, but I held all the way as it was for long term dividend investment. I have received quite a bit of dividends, and it is back to positive. The value does rise fast and drop fast, but as long as you know what you are buying for and stick to your strategy, the risks are very low.
It's indeed weird that people run away from GSS in equities, but rush to GSS in shopping centres...
Another example... Starhub... I still remember how people were complaining when it lost the BPL to Singtel... Look at the price now since the BPL incident.
Originally posted by eagle:If you view stocks merely for capital gain, merely as a tool for speculation, then you can earn fast and lose fast.
Investing for dividends and long term growth is akin to investing in a property. There's nothing wrong buying blue chips during recession. How many of your friends were telling you to sell at the start of 2008? Were you buying back then? Did you have to courage to put money in when there's huge margin of safety although prices are going down? It's easy to say on hindsight, I agree. But the person in the article did that as well, bravely buying when STI was below 2000 when everyone was running away.
Prudent homework have to be done. It's not easy money, because you have to know why and what you are buying. I have missed opportunities because I have not yet finished doing homework on it, but so?
High risks? It's not when you have done sufficient homework.
In short, if you are buying on speculation and hearsay, you are subjected to high risks. If you buy according to sound principles, risks are extremely low. i.e. I bought SPH at $4, $3.8, $3.14, before it went down to near $2, but I held all the way as it was for long term dividend investment. I have received quite a bit of dividends, and it is back to positive. The value does rise fast and drop fast, but as long as you know what you are buying for and stick to your strategy, the risks are very low.
It's indeed weird that people run away from GSS in equities, but rush to GSS in shopping centres...
Another example... Starhub... I still remember how people were complaining when it lost the BPL to Singtel... Look at the price now since the BPL incident.
Just a qns, so in ur view, is it still GSS now if u wana invest long term? Since from the recession, most of the stocks have rose more than 50%, so will it peak at here? :)
Originally posted by SpeedStar:Just a qns, so in ur view, is it still GSS now if u wana invest long term? Since from the recession, most of the stocks have rose more than 50%, so will it peak at here? :)
It varies from stock to stock. My most recent purchase was on Christmas Eve, Starhill REIT at 0.51, based on fundamentals and technicals combined.
At the moment, I still have spare funds, I can't find any more that are of value and are at good entry points. However, if you have long holding power like I did for SPH, you could still get it for it's yearly dividends.
Can anyone intro a book or a website where i can read up on how to invest in shares or stuff like that?
In fact I dun mind reading up on your experience and such...
Thanks.
Hi Desertkrieg,
yup. But holding stubbornly does not apply to all stocks, e.g. Chartered. But Chartered was loss making all the way, so no point getting it at all in the beginning...
Investing and trading just a fine line apart these days...
Originally posted by maxsee:Dunno real or not...he say he invest 100k++ and get dividend of 24k++ per annum a bit hard to believe when dividend nowadays only amount up to 6%+- or so.......><"
Cambridge gives 12% yield
At one point, Saizen REIT was giving 20% yield
The problem with this dividend stocks lies in their ability to pay sustainable dividends. The moment they start to cut the dividends due to financing issues, the ability to borrow money at cheaper interest rates diminishes.
Originally posted by goofyzell:Can anyone intro a book or a website where i can read up on how to invest in shares or stuff like that?
In fact I dun mind reading up on your experience and such...
Thanks.
Go to the Library and Borrow Investing for dummmies.
a pity i was in camp during march or else i would have dump all my money into uob. isolated the market from myself during NS. big mistake.
You have to learn to be identify the good stock so that you can invest at the appropriate time.
Buy Low and Sell High is the ideal condition.
But, it is always after things happened that you regretted.
So, start saving money now and when there is a crisis, buy the shares that you have performed your research.
It is a very shiong task to perform the study and analysis.
But, nothing come easy without hard work.
i now forcing myself to read 2 companies reports a night before bed. haha. ya must develop the habit. and bold.
Originally posted by eagle:Hi Desertkrieg,
yup. But holding stubbornly does not apply to all stocks, e.g. Chartered. But Chartered was loss making all the way, so no point getting it at all in the beginning...
Investing and trading just a fine line apart these days...
bought my chartered at 7 dollar plus last time ar...... just got back less than 2K recently.......knn.... my biggest lost to date.....
Originally posted by shade343:Cambridge gives 12% yield
At one point, Saizen REIT was giving 20% yield
The problem with this dividend stocks lies in their ability to pay sustainable dividends. The moment they start to cut the dividends due to financing issues, the ability to borrow money at cheaper interest rates diminishes.
that's why it's important to find those with strong backers... e.g. starhill, capitacomm trust, SPH, mapletree logistics....
Originally posted by Medicated Oil:You have to learn to be identify the good stock so that you can invest at the appropriate time.
Buy Low and Sell High is the ideal condition.
But, it is always after things happened that you regretted.
So, start saving money now and when there is a crisis, buy the shares that you have performed your research.
It is a very shiong task to perform the study and analysis.
But, nothing come easy without hard work.
that's why it's not easy money :)
Originally posted by maxsee:Dunno real or not...he say he invest 100k++ and get dividend of 24k++ per annum a bit hard to believe when dividend nowadays only amount up to 6%+- or so.......><"
It is possible.
I bought Cambridge Reit when the dividend rate was 20%.
Cambridge Reit's highest dividend rate was 30+% some time last year.
For all the talk about winner, there will be a loser as well.
the sunday times yesterday features the head of 3 investment research firms (DBS Vickers, DMG and OCBC). generally, they picked oil/ gas/ shipping/ marine/ property/ REITs/ Hospitality
OCBC also picked the 3 telcos and SMRT.
Originally posted by bladez87:a pity i was in camp during march or else i would have dump all my money into uob. isolated the market from myself during NS. big mistake.
UOB is quite irritating.. STI gain, it will drop. STI drop, it will drop even more.. that kind of thing.. few weeks back, uob was at least $5.20 higher than dbs, but recently, dba gained a lot ($15+) now, while uob still hanging at mid 19s.. DBS gained more than UOB in percentage wise imo..
the cheaper stockes were better winners like sembmarine swiber
Originally posted by kilfer:It is possible.
I bought Cambridge Reit when the dividend rate was 20%.
Cambridge Reit's highest dividend rate was 30+% some time last year.
sianzzzz tt time suntec reit was only 50cents (works out dividend to be 25%).. i bought at 99.5cts.. now, it got some placement issue, so the shareholdings r diluted means lesser dividends.. also got high risk of rights issues